Friday, April 3, 2015

The Zero Interest Rate Policies will lead sooner or later to Disaster

ET
Now: What happens to the equity markets? Do they still stand out on a
relative basis as opposed to other emerging markets or do you think they
can pick up strength on their own in another quarter or two?

Marc Faber : First
of all I would like to say that the Indian markets started to perform
well long before Mr Modi was elected. At the end of 2013 the markets
already started to rise considerably and this increase in prices has
continued. Last year the market was up.
There is difference
between various asset classes. In the US we have essentially high
valuations by any measurement. In Europe, we have lower valuations and
in emerging economies we have the lowest valuations. So from a
longer-term perspective, I would rather invest money in emerging
economies.
In the case of India, we have a similar situation like
in some other markets. There are some blue chip stocks like Nestle.
They sell at close to 50 times earnings. On the other hand, you have
other sectors, other companies that are selling at maybe only 10 to 15
times earnings and the difference between India and the European markets
or the US markets is that India has one of the best central bankers in
the world having Mr Rajan. He has kept interest rates relatively high
and has the flexibility to bring them down if he wants to.
I do
not necessarily advocate low interest rates. I think the zero interest
rate policies that Japan, Europe and the US have adopted will lead
sooner or later to disaster, but it has led to rising stock prices. In
Europe if you are an institution or a wealthy individual, your choice is
to put money in the banking system. It is not very safe either and you
will get zero interest rate. You can buy government bonds.

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.Dr. Doom also trades currencies and commodity futures like Gold and Oil.

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Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.Dr. Doom also trades currencies and commodity futures like Gold and Oil.

Dr. Marc Faber joins Alex Jones live via Skype to expose how contemporary politics aim to use white people as a generic group to blame f...

Dr Faber studied economics at the University of Zurich and, at the age of 24, obtained a PhD in economics. He publishes a widely read monthly investment newsletter The Gloom, Boom & Doom Report, which highlights unusual investment opportunities, and is the author of several books, including Tomorrow’s Gold – Asia’s Age of Discovery which was first published in 2002 and highlights future investment opportunities around the world. Tomorrow’s Gold was for several weeks on Amazon’s bestseller list and has been translated into Japanese, Korean, Thai and German. A regular speaker at various investment seminars, Dr Faber is well known for his contrarian investment approach. He is also associated with a variety of funds.

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Dr. Marc Faber Short Bio

Who is Marc Faber author of the Gloom, Boom and Doom report is a world class Investor, Doctor Faber 's typically controversial and contrarian views have earned him the label of Dr. Doom. Doctor Doom also trades currencies and commodity futures like Gold Natural Gas and Crude Oil.Even his harshest critics must admit that he's been unerringly correct in his market forecasts over the past three decades . Marc Faber is a Swiss investor.He was born in Zurich, Switzerland. He went to school in Geneva and Zurich and finished high school with the Matura. He studied Economics at the University of Zurich and, at the age of 24, obtained a PhD in Economics magna cum laude. Between 1970 and 1978, Dr Faber worked for White Weld & Company Limited in New York, Zurich and Hong Kong. Since 1973, he has lived in Hong Kong. From 1978 to February 1990, he was the Managing Director of Drexel Burnham Lambert (HK) Ltd. In June 1990, he set up his own business, which acts as an investment advisor and fund manager. Faber is publisher of the Gloom Boom & Doom Report newsletter and is the director of Marc Faber Ltd which acts as an investment advisor and fund manager.